SINGAPORE — Firms and workers must embrace and not resist changes brought on by technology, said Prime Minister Lee Hsien Loong on Tuesday (May 1) as he cited how the transport, banking, as well as retail and logistics industries here have transformed for the better. 

Addressing more than 1,600 guests, including union leaders and tripartite partners, at the annual May Day Rally, Mr Lee said: "The changes are positive. 

"We have to embrace them, we cannot try to stop the changes... I know it is not easy to change, I know it is coming fast and furious, and many workers worry about the pace of change. The Government and the Labour Movement will walk with you and support you all the way."

In the transport sector, taxi firms have had to adapt quickly to the influx of ride-sharing outfits like Grab, he noted, such as by adopting dynamic pricing. The Land Transport Authority, too, had to keep up by revising or setting new rules to level the playing field.

While some cabbies "had their grumbles" when ride-sharing first came to Singapore, most have taken them in their stride, such as by adopting the mobile apps for ride-sharing, said Mr Lee.

The industry is still in flux, he said, noting that the Competition and Consumer Commission of Singapore is still investigating the merger between Grab and Uber to preserve competition in the industry.

Meanwhile, changes in the banking sector have had a longer runway: It has seen three waves of disruption, from the initial days of automated teller machines, to the advent of mobile banking today.

A fourth phase of changes characterised by financial technology startups will continue to disrupt traditional financial services beyond the next five years, he said.

As mobile banking becomes more pervasive, banks here are also trimming back on their branch networks. The Monetary Authority of Singapore is working with banks to build digital capabilities, reskill and redeploy frontline staff, Mr Lee said.

In the retail and logistics sector, traditional brick and mortar stores have been supplanted by e-commerce. Some patrons now browse products at physical stores here, only to buy them off e-commerce sites such as Amazon and Taobao later, he pointed out.

However, technology has also helped streamline processes upstream, such as in the warehousing business.

These changes require logistics and retail firms to work closely together, said Mr Lee, such as by integrating their systems and collaborating across industries.

Retailers may also have to change their business models, such as by expanding into services that online stores will find hard to replicate, he said.

Mr Lee cited various measure to train and upgrade workers, such as the Adapt and Grow initiative, place-and-train scheme, and professional conversion programmes.

The Prime Minister also stressed the importance of tripartism, referring to the collaboration between unions, employers and the Government, as the "crucial ingredient" that has driven Singapore's survival and success over the years.

"It has seen us through every economic crisis and transformation... Each time the challenges seemed daunting, sometimes even overwhelming. But without the Labour Movement partnering companies, without the NTUC (National Trades Union Congress) partnering the People's Action Party in a symbiotic relationship, without the Government, unions and businesses sharing responsibility for Singapore's future, we would not have made it here," he said.

Mr Lee also spoke on the leadership renewal in the Government and the labour movement. Cabinet Minister Ng Chee Meng, who is expected to take over leadership of the labour movement, and Senior Minister of State (National Development and Trade and Industry) Koh Poh Koon have joined NTUC, while outgoing labour chief Chan Chun Sing will helm the Ministry of Trade and Industry from Tuesday.

"As younger leaders take over on both sides, in political and union leadership, they must renew the trust between the Government and the NTUC, and renew their commitment to the tripartite relationship," said Mr Lee. 

Mr Ng is "no stranger" to NTUC, said Mr Lee. Mr Ng who was previously Education Minister (Schools) and Second Minister for Transport, had worked very closely with the teacher and public transport worker unions, Mr Lee noted.

"I am confident that he will build on Chun Sing’s good work and lead NTUC well," he added. He noted that Dr Koh will strengthen the labour movement’s link with industry and businesses, and also with the Government.

In his speech, Mr Lee also reiterated his concerns on brewing trade tensions between the United States and China, noting that Singapore could suffer "collateral damage".

For example, US duties on solar panels, steel and aluminium apply to Singapore’s exports too. China announced a few weeks ago tariffs on synthetic rubber originating in the US, European Union and Singapore which will impact businesses here too.

These tensions can also lead to "a more serious quarrel" that affects global stability and security, Mr Lee warned.

"There will be further friction, and possibly conflict. Other countries who want to be friends of both will be put under pressure (to take sides). So what is at stake is not just prosperity, but war and peace," he said.